REG - Heavitree Brewery - Half-year Report

Heavitree BreweryAnnouncement

28/06/2018 16:00

RNS Number : 8891S
Heavitree Brewery PLC
28 June 2018
 


The Heavitree Brewery PLC
Trood Lane
Matford
Exeter EX2 8YP
 
Date:                28 June 2018
 
Contact:           Graham Crocker - Managing Director - 01392 217733
Nicola McLean - Company Secretary - 01392 217733
Patrick Castle /Anita Ghanekar - Shore Capital - 0207 408 4090
 
 
Following a meeting by a duly authorised committee of the Board of Directors held today, 28 June 2018, the Directors announce the interim results for the six months ended 30 April 2018.
 
 
Chairman's statement
 
Turnover for the period under review has increased by £47,000 (1.40%) against the corresponding period last year.  However there has been a 9.60% decrease in operating profit to £631,000 (2017: £698,000) predominantly due to an increase in costs associated with the Group's final salary Pension Scheme of £48,000 and a cost of £20,000 caused by the write down of old inventory items which have been moved from some of our houses over previous years and are now being held in storage. 
 
Results
 
The Group has returned an operating profit of £631,000.  After allowing for finance costs of £132,000 (2017: £140,000) which include a £41,000 interest cost in respect of the IAS 19 calculation applied to the final salary Pension Scheme (2017: £41,000) and a book profit mostly generated by the sale of four properties (£830,000), the Group Profit before taxation is £1,329,000 (2017: £558,000).  This shows an increase of 138.17% on the previous year.
Dividend
 
The Directors have resolved to pay an unchanged interim dividend of 3.675p per Ordinary Share and 'A' Limited Voting Ordinary Share (2017: 3.675p).  The Dividend will be paid on 3 August 2018 to shareholders on the Register at the close of business on 20 July 2018.
Property
 
The King of Prussia in Bovey Tracey completed on 27 November for £275,000.  We understand that the site will be converted into a community facility incorporating a small cinema.
 
The sale of The King's Arms in Strete completed on 9 March for £275,000.  We have retained a small cottage with a garden, a further small pocket of land and some parking on the site. 
The sale of The Crown and Sceptre in Newton St.Cyres completed on 23 April for £280,000. 
The sale of the flats which we built in 2012 at the old St.Loye's Hotel site completed on 26 April for £595,000.
At the time of writing, two unlicensed properties in Exeter and another in the South Hams are being marketed for sale.  One of the Exeter properties is sold subject to contract.  I hope to report further on these at the year-end.
 
Prospects
 
The sales of The King of Prussia, The King's Arms and The Crown and Sceptre, all of which had been closed for some time and had been incurring various consequential costs, will have a positive effect for the Group in terms of revenue. The proceeds from the sales have also reduced our level of debt which the Board considers to be a prudent goal in these uncertain times.
 
Trading has remained ahead of budget at the end of the first half of the year.  The trading effect of the FIFA World Cup looks promising and, together with the prolonged period of favourable weather which our region is currently enjoying, we believe that the Company is well placed going into the second half of the year.
 
 
N H P TUCKER
Chairman
 
 
Group income statement (unaudited)
For the six months ended 30 April 2018




 


 


6 months
to
30 April

2018


 
6 months
to
30 April
2017


Audited
12 months
to
31 October
2017




 


Note


£' 000


£' 000


£' 000




Revenue


 


    3,398


         3,351


          7,299




Change in stocks


 


-


-


-




Other operating income


 


139


134


384




Purchase of inventories


 


(1,342)


(1,318)


(2,968)




Staff costs


 


(697)


(625)


(1,353)




Depreciation of property, plant and equipment


 


(115)


(113)


(248)




Other operating charges


 


          (752)


          (731)


       (1,336)




 


 


       (2,767)


       (2,653)


       (5,521)




Group operating profit


 


631


698


1,778




Profit on sale of property, plant and equipment


 


   830              


              -


           6     




Movements in valuation of estate and related assets


 


                 -


                  -


          -




Group profit before finance costs and taxation


 


1,461


698


1,784




Finance income


 


2


3


7




Finance costs


 


(93)


(102)


(182)




Other finance costs-pensions


 


            (41)


            (41)


            (55)




 


 


          (132)


          (140)


          (230)




Profit before taxation


 


1,329


558


1,554




Tax expense


 


          (189)


          (159)


          (226)




Profit for the period


 


         1,140


             399


          1,328




Earnings per share
- basic

- diluted


2


 
23.4p

23.4p


 
      7.9p

7.9p


 
    27.0p

27.0p




 
 
 
 
Group statement of comprehensive income (unaudited)
For the six months ended 30 April 2018




 


 


 
6 months
to
30 April

2018


 
6 months
to
30 April
2017


    Audited
   12months
    to
 31 October
      2017




 


 


£' 000


  £' 000


       £' 000




Profit for the period


 


        1,140


           399


          1,328




Items that will not be reclassified to profit or loss
Actuarial (losses)/gains on defined benefit pension plans
Tax relating to items that will not be reclassified
 


 


 
(254)
             99
   (155)


 
(69)
             12
(57)


 
428
             (74)
354
 




Items that may be reclassified to profit or loss
Fair value adjustment
Exchange rate differences on translation of subsidiary undertaking
Tax relating to items that may be reclassified
 
 


 


 
(5)
 
(6)
              -
(11)


 
1
 
-
                  -
1


 
6
 
-
                  -
6




 


 


 


 


 




Other comprehensive income for the year, net of tax


 


            974


             343


         1,688




Total comprehensive income attributable to:
Equity holders of the parent


 


 
             974


 
             343


 
          1,688




 


 


 


 


 




 
 
 
 
Dividends
The Directors declare an interim dividend of 3.675p per share (2017 - 3.675p) on the Ordinary and 'A' Limited Voting Ordinary Shares. This dividend will be paid on 03 August 2018 to shareholders on the register at 20 July 2018.
 
 
 
Group balance sheet (unaudited)




at 30 April 2018


 


 
30 April
2018
£' 000


 
30 April
2017
£' 000


Audited
31 October 2017
£'000




Non-current assets


 


 


 


 




Property, plant and equipment
 


 


18,163
 


18,380


18,116




Financial assets


 


47


41


46
 




Deferred tax asset


 


        230


              284


             221




 


 


       18,440


          18,705


        18,383




Current assets


 


 


 


 




Trade and other receivables


 


1,861


1,750


1,696




Inventories


 


10


10


10




Cash and short-term deposits


 


          113


               62


               56




 


 


         1,984


            1,822


          1,762




Assets held for sale


 


328


552
 


890




Total assets


 


      20,752


          21,079


        21,035




Current liabilities


 


 


 


 




Trade and other payables


 


(747)


(1,064)


(871)




Financial liabilities


 


(529)


(2,267)


(1,624)




Income tax payable


 


         (281)


            (223)


           (190)




 


 


      (1,557)


         (3,554)


        (2,685)




Non-current liabilities


 


 


 


 




Other payables


 


(319)


(264)


(256)




Financial liabilities


 


(6,011)


(6,011)


(6,045)




Deferred tax liabilities


 


(345)


(335)


(345)




Defined benefit pension plan


 


      (1,352)


         (1,667)


        (1,300)




 


 


      (8,027)


         (8,277)


        (7,946)




Total liabilities


 


    (9,584)


       (11,831)


      (10,631)




Net assets


 


    11,168


            9,248


        10,404




Capital and reserves


 


 


 


 




Equity share capital


 


264


264


264




Capital redemption reserve


 


673


673


673




Treasury shares


 


(1,240)


(1,212)


(1,223)




Fair value adjustments reserve


 


22


17


27




Currency translation


 


11


22


17




Retained earnings


 


11,438


            9,484


        10,646




Total equity


 


      11,168


            9,248


       10,404




 
 
 
Group statement of cash flows (unaudited)
for the six months ended 30 April 2018
                                                           




 


 


 
6 months
to
30 April

2018


 
6 months
to
30 April
2017


Audited
12months
 to
31 October
2017




Operating activities


 


£' 000


£' 000


£' 000




Profit for the period


 


1,140


399


1,328




Tax expense


 


189


159


151




Net finance costs


 


132


140


231




(Profit) on disposal of non-current assets and assets held for sale


 


 
(830)


 
-


 
(6)




Depreciation and impairment of property, plant and equipment


 


115


130


248




Exchange gain on cash, liquid resources and loan


 


5


-


(3)




Difference between pension contributions paid and recognised in the income statement


 


 
(240)


 
(554)


 
(438)




(Increase) in trade and other receivables


 


(131)


(165)


(76)




(Decrease)/increase in trade and other payables


 


         (60)


           78


          (170)




Cash generated from operations


 


320


187


1,265




Income taxes paid


 


(8) 


          - 


         (110)




Interest paid


 


      (93) 


        (102)


          (182)




Net cash inflow from operating activities


 


          219 


          85 


             973




 
Investing activities


 


 


 


 




Interest received


 


2


3


6




Proceeds from sale of property, plant and equipment and assets held for sale


 


1,441


-


193




Payments to acquire property, plant and equipment


 


   (249)


       (832)


  (1,117)




Net cash inflow from investing activities


 


       1,194


       (829)


 (918) 




Financing activities


 


 


 


 




Preference dividend paid


 


(1)


(1)


(1)




Equity dividends paid


 


(211)


(183)


(333)




Consideration received by EBT on sale of shares


 


53


44


49




Consideration paid by EBT on purchase of shares
Capital element of finance lease rental payments                                             


 


(68)
              (7)


  (4)  


(15)
           (21)




 


 


 


 


 




Net cash outflow from financing activities


 


     (234)


         (144)


        (321)




 


 


 


 


 




Increase in cash and cash equivalents


 


(1,179)


(888)


(266)




Cash and cash equivalents at the beginning of the period


 


 (1,536)


      (1,270)


      (1,270)




Cash and cash equivalents at the period end


 


   (357)


    (2,158)


 (1,536)




 
 
Group reconciliation of movements in equity (unaudited)
 
 
 




6 months to


Equity


Capital


 


Fair


 


Cashflow


 


 




30 April 2018


share


redemption


Treasury


value


Currency


hedge


Retained


Total




 


capital


reserve


shares


adjustment


Translation


reserve


earnings


equity




 


£' 000


£' 000


 £' 000


£' 000


£' 000


£' 000


£' 000


£' 000




 


 


 


 


 


 


 


 


 




At 1November 2017


264


673


(1,223)


27


17


-


10,646


10,404




Profit for the period


-


-


-


-


-


-


1,140


1,140




Other comprehensive income for the period, net of income tax


-


-


-


(5)


(6)


-


(155)


(166)




Total     comprehensive income for the period


-


-


-


(5)


(6)


-


985


974




Consideration
received by EBT on sale of shares                                  


 
 
 
-


 
 
 
-


 
 
 
53


 
 
 
-


 
 
 
-


 
 
 
-


 
 
 
-


 
 
 
53




Consideration paid by EBT on purchase of shares


-


-


(68)


-


-


-


-


(68)




 


 


 


 


 


 


 


 


 




Gain by EBT on sale of shares


-


-


(2)


-


-


-


2


-




Equity dividend paid


-


-


-


-


-


-


(195)


(195)




 


 


 


 


 


 


 


 


 




At 30 April 2018


264


673


(1,240)


22


11


-


11,438


11,168




 
 
 
 
 
Group reconciliation of movements in equity (unaudited) - continued
 




6 months to


Equity


Capital


 


Fair


 


Cashflow


 


 




30 April 2017


share


redemption


Treasury


value


Currency


hedge


Retained


Total




 


capital


reserve


shares


adjustment


Translation


reserve


earnings


equity




 


£' 000


£' 000


 £' 000


£' 000


£' 000


£' 000


£' 000


£' 000




 


 


 


 


 


 


 


 


 




At 1November 2016


264


673


(1,254)


21


      17


-


9,323


9,044




Profit for the period


-


-


          -


         -


        -


-


      399


      399




Other comprehensive income for the period, net of income tax


-


-


          -


  1 


     -


 -


      (57)


     (56)




Total     comprehensive income for the period


-


-


-


1


-


    -


342


343




Consideration
received by EBT on sale of shares    


 
 
 
-


 
 
 
-


 
 
 
44


 
 
 
-


 
 
 
-


 
 
 
-


 
 
 
-


 
 
 
44




Consideration paid by EBT on purchase of shares


-


-


-


-


-


-


-


-




Gain by EBT on sale of shares


-


-


(2)


-


-


-


2


-




 


 


 


 


 


 


 


 


 




Equity dividend paid


-


-


-


-


-


-


(183)


(183)




 


 


 


 


 


 


 


 


 




At 30 April 2017


264


673


(1,212)


22


17


-


9,484


9,248




 
 
 
 


 
 
 
Group reconciliation of movements in equity (unaudited) - continued
 
 




 
 
12 months to 31 October 2017
Audited
 
 


Equity share capital
£000


Capital redemption reserve
£000


 
Treasury shares
£000


Fair value adjustment reserve
£000


 
Currency translation
£000


Cash flow hedge reserve
£000


 
Retained earnings
£000


 
Total equity
£000




At 1 November 2016


264


673


(1,254)


21


17


-


9,323


9,044




 


 


 


 


 


 


 


 


 




Profit for the year


-


-


-


-


-


-


1,328


1,328




Other comprehensive income for the year
net of income tax


-


-


-


6


-


-


354


360




Total comprehensive


 


 


 


 


 


 


 


 




income for the year


-


-


-


6


-


-


1,682


1,688




Consideration received by EBT on sale of shares


 
-


 
-


 
49


 
-


 
-


 
-


 
-


 
49




Consideration paid by


 


 


 


 


 


 


 


 




EBT on purchase of shares       


-


-


(15)


-


-


-


-


(15)




Gain by EBT on sale of shares


-


-


(3)


-


-


-


3


-




Equity dividends paid


-


-


-


-


-


-


(362)


(362)




At 31 October 2017


264


673


(1,223)


27


17


-


10,646


10,404




                                                               
 
 
 
Equity share capital
The balance classified as share capital includes the total net proceeds (both nominal value and share premium) on issue of the Company's equity share capital, comprising 5p Ordinary and 'A' Limited Voting Ordinary Shares.
Treasury shares
Treasury shares represent the cost of The Heavitree Brewery PLC shares purchased in the market and held by The Heavitree Brewery PLC Employee Benefit Trust ('EBT').
 
 
 
Notes to the interim results
 
1.  Basis of preparation
 
These unaudited interim condensed and consolidated financial statements have been prepared in accordance with IAS34 "interim financial reporting" and do not constitute statutory accounts within the meaning of section 435 of the Companies Act 2006.  They have been prepared on the basis of the accounting policies that were complied with in the annual financial statements for the year ended 31 October 2017. The accounting policies are drawn up in accordance with International Accounting Standards (IAS) and International Financial Reporting Standards (IFRS) as adopted by the European Union.
These unaudited financial statements were approved and authorised for issue by a duly appointed and authorised committee of the Board of Directors on 28 June 2018.
 
 
2.  Basic and diluted earnings per share
The calculation of basic earnings per ordinary share is based on earnings of £1,140,000 (2017: £399,000), being profit after taxation for the period, and on 4,876,995 (2017: 5,064,830) shares being the weighted average number of Ordinary and 'A' Limited Voting Ordinary Shares in issue during the period after excluding the shares owned by The Heavitree Brewery PLC Employee Benefits Trust and those shares under option pursuant to the Employee Share Option Scheme. Employee share options could potentially dilute basic earnings per share in the future but are not included in the interim calculation of dilutive earnings per share because they are antidilutive for the period presented. The Ordinary Shares and the 'A' Limited Voting Ordinary Shares have equal dividend rights and therefore no separate calculation of earnings per share for the different classes has been given.
 
3.  Segment information
 
Primary reporting format - Business segments
The primary segmental reporting format is determined to be business segments as the Group's risks and rates of return are affected predominantly by differences in the products and services provided.
During the year the Group operated in one business segment-leased estate.
Leased estate represents properties which are leased to tenants to operate independently from the Group.
 
4.  Interim report
 
Copies of this announcement are available from the Company at Trood Lane, Matford, Exeter EX2 8YP. The Company's interim report for the six months ended 30 April 2018 has been posted to shareholders today and will be available on our website at www.heavitreebrewery.co.uk.
 
Ends.




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END
 
 
IR SESSAAFASEFM